SAN ANTONIO -- Valero Energy Corp. will distribute to shareholders 80% of the equity in its retail segment as part of the refiner's plans to spin off the business, the company said Monday in a presentation at Citi Boston Energy Day, according to MarketWatch report.
The company also announced several corporate leadership changes that will be affected by the retail separation.
Valero plans to spin off its Corner Store segment by the beginning of the second quarter amid a general reshuffling of its portfolio.
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Valero hopes that the spin off of its 6,800-retail stations will unlock value in the business. The business, normally a bright spot in the company's earnings, struggled in the third quarter as average operating income fell to half of year-earlier levels, mostly because fuel margins plummeted 40%, the report said.
"Investors and analysts have treated Valero mainly as a refiner, ignoring higher potential value of the retail segment," the company said at a investors presentation cited by the news outlet.
The leadership changes that will take effect on Jan. 1, 2013, the company announced. Kim Bowers, currently serving as executive vice president and general counsel, will be responsible for the company's retail organization in the United States and Canada as executive vice president and president of retail and will remain with retail when it separates from Valero next year.
Gary Arthur, currently corporate senior vice president and president of retail, will be corporate senior vice president of wholesale marketing, a growing and very important segment of Valero.
Jay Browning, corporate senior vice president and corporate secretary, will become corporate senior vice president and general counsel, replacing Bowers.
Meanwhile, Jim Gillingham, corporate senior vice president alternative energy and project development, will move to corporate senior vice president of specialty products.
Martin Parrish, corporate vice president crude, feedstock supply and trading, will become corporate vice president, alternative energy and project development.
Gary Simmons, corporate vice president supply chain optimization, will become corporate vice president crude, feedstock supply and trading.
"This realignment is important for the development and execution of our strategies and for the individual development of key leaders within Valero as we prepare for a rapidly changing competitive environment," said Valero chairman and CEO Bill Klesse.
In mid-November, Valero announced today that Joe Gorder, executive vice president and chief operating officer, would become president and COO, effective Jan. 1.
San Antonio-based Valero Energy, through its subsidiaries, is an international manufacturer and marketer of transportation fuels, other petrochemical products and power. Assets include 15 petroleum refineries with a combined throughput capacity of approximately 2.8 million barrels per day, 10 ethanol plants with a combined production capacity of 1.2 billion gallons per year, and a 50-megawatt wind farm. Approximately 6,800 retail and branded wholesale outlets carry the Valero, Diamond Shamrock, Shamrock and Beacon brands in the United States and the Caribbean; Ultramar in Canada; and Texaco in the United Kingdom and Ireland.
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